Is Globalisation Taking A Breath?

Many countries focus on the benefits of globalisation but recent changes in economic trade and growth figures highlight the need for reflection. Globalisation has continued apace for the last 20 years or so, as the rate of economic growth increased trade between countries.

In the last couple of years, however, there has been a reduction in the level of trade between some countries as companies make significant investments in their home markets.

National politics and local economics are playing a part, as supply chain security and the costs of transport are balanced against the need to secure jobs at home.

There is little doubt that the last couple of decades of globalisation have increased links between countries, as more trade, jobs and investment flows across borders. 

There was a sense of openness and energy and a desire by governments and businesses to travel to all corners of the world to create new opportunities.

Now, however, a change is taking place as companies make significant investments at home and focus on getting things right in local markets as a way to secure their long-term position.

Ideas, such as free market capitalism and globalisation, that helped get us into this position are increasingly questioned and seen as less than ‘fit for purpose’.

The strain of pursuing relentless growth has taken its toll, not least in relation to banks and financial institutions as they try to fix their balance sheets and rebuild locally.

Even China is facing the need to address the internal challenges presented by the expectation of its people to create sufficient jobs and distribute wealth in an equitable way.

China’s actions in relation to trading beyond its borders have been driven by its need to purchase raw materials to sustain its growing economy.

The importance of buying locally is gaining in popularity, as people want to identify the origin of the goods they buy and minimise their global impact.

The pursuit of growth through globalisation has come at a cost and people and companies increasingly want to pause and consider alternative solutions.

SO, for the first time in many years the process of globalisation is being revisited, as companies invest in their home markets and build for the long-term.

What do you think? Is globalisation taking a breath? Get in touch, we would love to hear your views contact Nick on 028 8224 9494 or via Twitter @nick_oec.